Tax Planning for Early Retirement: The Great Resignation

Lately, we have heard a great deal about the Great Resignation. Many are calling it the Great Retirement. More people retire before age 59 1/2, not realizing that they will be subject to substantial penalties if they take distributions from their retirement accounts. There are exceptions to the early distribution penalty. The IRS recently made it easier to take money out of your retirement accounts before age 59 1/2.

In addition to retirement withdrawals, there are significant tax differences between traditional and Roth IRA contributions and withdrawals. Tax planning can help negate the tax impact of IRAs and capital gains. Social Security planning can increase the amount a taxpayer receives monthly and reduce the taxes paid on this income.

As taxpayers approach specific ages, they should recognize particular tax issues. Among these are tax considerations when a taxpayer reaches ages 65, 55, and 59 1/2. Tax professionals working with clients contemplating or approaching retirement, particularly early retirement, need to comprehend the impact of decisions made on tax liability.

Listen as our veteran federal tax panelist provides tips for reducing taxes and eliminating penalties paid on income received for retirees.

1. Tax planning for early retirement
2. Age thresholds
   1. Age 65
   2. Age 55
   3. Age 59 1/2
3. Investment planning
   1. Investment income
   2. Capital gains
4. Retirement accounts
   1. Early distribution penalties
   2. Exceptions to early distribution penalties
   3. IRS Notice 2022-6: Determination of Substantially Equal Periodic Payments
5. IRAs
   1. Traditional
   2. Roth
6. Social Security planning

The panel will cover these and other critical issues:

• Tax planning approaching specific age thresholds: 65, 55, 59 1/2
• How Social Security planning can increase benefits received and taxes paid
• How IRS Notice 2022-6 eases taxes paid on distributions by retirees
• Methods to limit taxes paid on capital gains for retirees

Learning Objectives

After completing this course, you will be able to:

• Identify tax considerations of taxpayers approaching the age of 59 1/2
• Ascertain healthcare choices available for individuals approaching retirement
• Decide specific steps certain taxpayers can take to increase Social Security benefits
• Determine how IRS Notice 2022-6 can reduce taxes paid by retirees

• Field of Study: Taxes
• Level of Knowledge: Intermediate
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite: Three years+ business or public firm experience preparing complex tax forms and schedules, supervising other preparers or accountants. Specific knowledge and understanding of individual income taxation, including itemized deductions, individual income tax credits, net operating loss limitations including carrybacks and carryforwards.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).